Reporting on the major trends that took place in retail real estate in 2009, and expectations for the coming year, CoStar Group recently provided clients with a detailed analysis on the retail real estate market in the latest in its series of quarterly webinars. Jay Spivey, CoStar's senior director of research analytics, and Real Estate Strategist Suzanne Mulvee from CoStar affiliate Property & Portfolio Research, presented the findings, tempering the positive overall outlook for the retail sector with the fact that the market is still in the midst of a correction.

"It's still tough going, but things are improving," said Mulvee, noting that GDP was up in third quarter and is forecast to grow between 2% and 4% each quarter in 2010, thanks to expected increases in inventory levels and consumer consumption following the extensive government stimulus. . . . more

Dallas-based all-natural nonfat frozen yogurt retailer Red Mango announced record franchise development during 2009, signing 42 franchisees to open a total of 219 locations. Development agreements included further expansion in California, Utah, Nevada, Washington, Illinois and New York, as well as entry into Arkansas, Colorado, Indiana, Kansas, Massachusetts, Missouri, New Jersey, Louisiana, Minnesota, Texas, Virginia, Wisconsin and Washington, D.C. . . . more

The economy grew faster than expected at the end of last year, though the engine of that growth — companies replenishing stockpiles — is likely to weaken as consumers keep a lid on spending.

The 5.7 percent annual growth rate in the fourth quarter was the fastest pace since 2003. The Commerce Department report Friday is the strongest evidence to date that the worst recession since the 1930s ended last year, though an academic panel that dates recessions has yet to declare an end to it.. . . more

Costco and other warehouse clubs have done relatively well in an economy that has been particularly brutal to retailers. Overall retail sales were down about 8 percent for the first 11 months of 2009, but sales at warehouse and superstores were up 2 percent, according to the U.S. Census' monthly retail trade report.

The three biggest club players are Sam's Club (605 stores), Costco (566) and B.J.'s Wholesale Club (184, mostly on the East Coast).. . . more

Bookseller Borders Group Inc. is laying off 164 staffers in an effort to cut costs amid slumping sales.

The company has cut 124 corporate jobs, including 88 at its Ann Arbor, Mich., headquarters and 36 corporate staffers in other locations. The company also cut 40 from distribution centers in Tennessee and California. . . . more

Wal-Mart Stores Inc., the world's largest retailer, said Thursday it is realigning its United States operations in an effort to give more autonomy to executives in regional markets and reinvigorate U.S. growth.

Wal-Mart is combining its U.S. realty, store operations and logistics divisions and reorganizing operations under three geographic business units headed up by regional presidents: West, South and North. . . . more

Thursday, January 28, 2010

P.C. Richard & Son will open its first Philadelphia-area stores and may add upward of five Connecticut locations this year as part of a planned expansion that could extend its reach from Delaware to Massachusetts.

The family-owned CE and appliance chain plans to open seven to 10 stores in total this year, including two in the Philadelphia market and two in New Jersey.It also opened seven stores last year, including its first Connecticut location, in Norwalk.. . . more

Rental company Movie Gallery Inc plans to file for Chapter 11 bankruptcy as soon as next week, marking the second time in two years the owner of Hollywood Video stores has sought protection from creditors, the Wall Street Journal reported on Wednesday.

The debt-burdened company, based in Oregon, has faced harsh competition from upstart mail services like Netflix Inc and kiosks such as Coinstar Inc's Redbox.. . . more

While “value” may be the buzzword of the year for cash-strapped consumers and the restaurants that serve them, two reports released Wednesday indicated that convenience is another factor nearly as important for many adults making food choices.

One third of adults are “convenience consumers,” according to market research firm The NPD Group, which on Wednesday released a report called “The Many Facets of Convenience.” These consumers ranked convenience as most important in choosing the foods they eat, both in supermarkets and restaurants.. . . more

Macy's Inc., the second-biggest U.S. department-store chain, is eliminating 1,500 store-level positions effective March 6, two people familiar with the decision said yesterday.

Macy’s, based in Cincinnati, is firing department managers and merchandising team managers, said the people, who declined to be identified because the cuts haven’t been made public. Some stores are losing operations managers, and the remainder will be shared across multiple stores, the people said. In addition, full-time stock positions were cut, they said. . . . more

In 2005, when shopping center giant Developers Diversified Realty of Ohio spent $14 million to buy at auction the Venture Corp. site off Lafayette Road, most of the 47 acres were in the industrial zone, with a small portion near the entrance of the property in the commercial zone.

However, using the town's zoning regulations, DDR was able to apply for and obtain a special exception from Seabrook's Zoning Board of Adjustment to have the zoning of the entire lot changed to the commercial zone, which allowed retail use on the land.. . . more

Commercial real estate is expected to remain a drag on the U.S. economy through 2010 and beyond.

"You do see stress in the market. We've seen delinquency rates increasing; we've seen by a whole variety of measures increased stress in the commercial real estate market," said Jamie Woodwell, the vice president of commercial real estate research for the Mortgage Bankers Association.. . . more

CoStar Group Inc.’s National Retail Market report reveals that the retail real estate industry delivered 79.5 million square feet of space in 2009—the lowest amount of new construction in CoStar’s records, which go back to 1982.

The amount of new space fell throughout the year with the fourth quarter marking a new low point, according to the report. During the fourth quarter 2009, 462 buildings totaling 14,387,904 square feet were completed in the U.S. retail market, compared with 700 buildings with 20,676,093 square feet completed in the third quarter, 730 buildings totaling 18,722,135 square feet in second quarter 2009, and 1,046 buildings totaling 25,741,120 square feet in the first quarter 2009.. . . more

FB Liquidating Estate, what remains of Filene’s Basement, has won bankruptcy court approval for a plan that will pay secured creditors in full and pay unsecured creditors 75 cents on the dollar.

The Burlington, Mass.-based company, a former subsidiary of Columbus' Retail Ventures Inc., filed for bankruptcy reorganization in May. Discount retailer Syms Corp. and real estate firm Vornado Realty Trust paid $64 million for most of the company's assets, and will continue operating the retailer under new ownership and its familiar Filene’s Basement name.. . . more

Visitors to the Stop & Shop at 79 Washington Ave. will soon have access to real estate professionals when they are in the supermarket. Re/Max of New England on Tuesday announced plans to open a “micro” real estate office in the store, along with 16 other franchises in Stop & Shop locations across Connecticut, Massachusetts, Rhode Island and New Hampshire.. . . more

A little more optimism about the current economic climate sent the U.S. consumer confidence index to a 16-month high in January, according to a survey released Tuesday by the Conference Board.

The consumer confidence index rose to 55.9 in January from an upwardly revised 53.6 in December. It's the highest reading since September 2008, when the financial crisis intensified. It was the third straight increase. . . . more

Close-out retailer Tuesday Morning Corp reported a 45 percent rise in second-quarter profit as more customers shopped at its stores during the holiday season, and maintained its full-year outlook.. . . more

Tuesday, January 26, 2010

Goodbye, old Ruby Tuesday. Known for decades for its casual burger-and-salad restaurants, the nearly 40-year-old chain has undergone an aggressive $100 million makeover that started just before the recession sapped many restaurant companies of their earnings.

But finally, analysts say, the risky menu switch, as well as a cultural shift in how Ruby Tuesday approaches the food business, may be paying dividends with a return to profits and brighter prospects for the roughly 900-unit chain.. . . more

The National Retail Federation released its 2010 economic forecast today, projecting retail industry sales (which exclude automobiles, gas stations, and restaurants) will increase 2.5 percent from last year. According to its bi-monthly Retail Sales Outlook, influential economic indicators such as the housing market and employment are beginning to show positive signs, which will bolster consumer confidence throughout the year. Total industry retail sales for 2009 declined 2.5 percent.

“As we continue to see signs of improvement throughout the U.S economy in 2010, overall sentiment will begin to lift, making way for slight increases in consumer spending,” said NRF Chief Economist Rosalind Wells. “While we still expect shoppers to continue to be frugal with their discretionary spending, retailers will soon be able to reap the benefits of leaner, smarter inventories and a year and a half of pent up consumer demand.”. . . more

There is a place in downtown Scranton where you can view the latest creations from local artists, whiten your teeth, enjoy a relaxing massage and take your children through an educational experience. While you're there, you can pick up some jeans, shoes and accessories - all without ever walking outside.

That place is the Mall at Steamtown, now one of many shopping malls across the nation turning to nontraditional tenants to fill a growing number of vacancies.. . . more

A bankruptcy judge in Delaware gave Tops Friendly Markets the go-ahead Monday to acquire Penn Traffic Co.’s 79 supermarkets in the Northeast.

Tops, a 76-store chain based in suburban Buffalo, said U.S. Bankruptcy Judge Peter Walsh approved its offer to pay Penn Traffic $85 million in cash and eliminate about $100 million in unsecured claims against the estate of the bankrupt Syracuse-based grocer.. . . more

Borders Group Board Chairman Mick McGuire today announced that Ron Marshall has resigned as President, Chief Executive Officer and a Director of the company, effective immediately. Marshall has accepted the role of Chief Executive Officer with another publicly held retailer, but will assist Borders in the process of transitioning to new leadership.

The company has named Executive Vice President and Chief Merchandising Officer Michael J. Edwards as the Interim Chief Executive Officer. . . . more

Retail Forward, a Kantar Retail Company, forecasts that retail sales will show quarter-by-quarter improvement in 2010 and approach long-term average growth rates by the end of the year. Retail Forward’s 2010 forecast for retail sales excluding the auto and fuel channels is an increase of 1.5% to 2.0% in the first two quarters of the year and a step up to 3.0% to 4.0% growth in the second half of the year as job and income growth start to re-emerge.

“The first clear sign that retail sales are on the path to recovery came during the holiday,” comments Frank Badillo, Senior Economist for Retail Forward, a Kantar Retail Company. “Keeping retail sales on this recovery path will require—more than anything—a return of job and income growth,” he continues.. . . more

Liz Wyman is done splurging on indulgences like a $300 leather Michael Kors bag and a pair of $575 black suede Cole Haan boots.Instead, the 46-year-old state lawyer in Maine is scrimping however she can, tossing out catalogs from Neiman Marcus and avoiding Saks and Nordstrom at all costs. With her income eroding, she says, “I have to walk away.’’. . . more

Monday, January 25, 2010

Ahold reported identical-store sales gains at its U.S. banners for the fourth quarter and fiscal year, as strong sales volumes overcame price deflation and sales promotions.

The identical-store sales growth exceeded analyst estimates as well as the sales performance of peers in the same period, indicating Ahold increased market share for the quarter, particularly in the Washington, D.C., market where the Giant-Landover division showed a 1.6% identical-store sales increase. . . . more

Bankrupt U.S. shoe retailer, The Walking Company, will seek court approval next month to close 40 additional stores.

The retailer, which sells comfortable shoes at its namesake stores and also runs the Big Dogs sportswear clothing line, filed for bankruptcy in early December with a plan to close 90 of its original 210 stores immediately.. . . more

More companies in the U.S. plan to increase payrolls and invest in new equipment this year as demand strengthens and credit availability improves, a quarterly survey of economists showed.

The percentage of businesses expecting to hire in the next six months exceeded the share projecting more firings by 6 points, according to a survey by the National Association for Business Economics issued today in Washington. Expectations for capital spending improved for a fifth straight quarter. . . . more

Massachusetts marked a sobering milestone last month: For the first time since World War II, the state ended a decade with fewer jobs than it had at the beginning.

The decade started with a technology bust and ended with a historic national recession. Job loss was spread over most of the state’s major employment sectors, as the decade’s quickening pace of globalization, competition, and technological change pressured the Massachusetts economy. Manufacturing took the biggest hit, shedding one job in three.. . . more

Sam's Club, the warehouse club division of Wal-Mart Stores Inc is cutting roughly 11,200 jobs, or about 10 percent of its workforce, as it outsources in-store product demonstrations and eliminates positions used to recruit new business members.

Sam's Club Chief Executive Officer Brian Cornell said on Sunday that the retailer would outline charges associated with the job cuts in February, when it releases fourth-quarter results. He said he did not expect any "material impact" on its financial results.. . . more

Friday, January 22, 2010

The National Association of Home Builders released its 2010 residential construction forecast.

The association is forecasting 697,000 total housing starts in 2010. The estimate, if correct, would be the second lowest annual housing start figure, but would mark a 25.9% increase over the 2009 mark of 553,800. . . . more

Whether they climb, hike or ride a bike, Recreational Equipment Inc. will offer the region's outdoor enthusiasts another shopping option when its second Connecticut store opens this fall at the former Linens 'N Things, 189 Connecticut Ave., Norwalk.

The new REI will offer camping, climbing, cycling, fitness, hiking, paddling, snow sports and travel products, including the chain's REI brand and Novara bike products, in more than 24,000 square feet. The store also will offer a bike shop for quick assemblies or repairs, and gear rental department.. . . more

Another bankruptcy hearing that could determine the sale of Penn Traffic supermarkets to Tops Markets is set to go forward Monday in Deleware.

Tops wants to buy all 79 stores run by bankrupt rival Penn Traffic for $85 million. Tops -- a 76-store chain based in suburban Buffalo -- said its bid has been accepted by Syracuse-based Penn Traffic and recommended to the US Bankruptcy Court in Deleware for approval.. . . more

Thursday, January 21, 2010

Bloomingdale’s is going the way of such upscale department stores as Nordstrom and Saks Fifth Avenue and getting into the outlet business, Macy's Thursday announced plans to launch a Bloomingdale’s Outlet store concept in 2010, with four locations scheduled to open in summer or fall. Additional Bloomingdale’s Outlet stores are expected to roll out to selected locations across the country in 2011 and beyond.. . . more

Well, now that we’ve made it through the Christmas season, we can sit back and find solace in the encouraging news on retail sales, right?

As we predicted several months ago (Awaiting A Telltale Month, KeyPoints, August 2009), comp-store sales were generally up during Q4 for retailers who reported them. While this might have been expected from the value-oriented retailers, what was most encouraging is the fact that the more discretionary retailers showed comp sales increases.. . . more

Town officials confirmed yesterday that plans are coming together for the building of a new CVS superstore at the corner of Main Street and Route 110.

Demolition applications for four properties — located at 244 and 246 Macy St. (Route 110) and 7 and 9 Macy St. — have been submitted to Amesbury's building inspector and Historical Commission, representing the first step in what Inspector Dennis Nadeau said will be a lengthy approval process for the proposed new storefront. . . . more

The number of U.S. convenience stores fell 0.2% over the past year and stands at 144,541 as of Dec. 31, 2009, according to the just-released NACS/Nielsen TDLinx 2010 Convenience Industry Store Count. Last year's count was 144,875, a difference of 334 stores. This is the second straight year the count has declined and only the fourth time in the last 15 years that the count has declined. The count reached a high of 146,294 stores two years ago.. . . more

One of the emerging stories in retail real estate is that healthy retailers are making moves to grab prime locations that have opened up in urban markets. This is especially true of big box players. A few years ago, cities were blocking these efforts. There were talks of legislation to block big-box construction in some places. You don’t hear any of that anymore. It seems that what’s worse than big-box stores in urban locations is having vacant storefronts. As a result, we’ll see more of these kinds of deals take place.

For example, in Chicago Target is reportedly scoping the historic Carson Pirie Scott & Co. building on State Street as a new store. Similarly, in New York, Nordstrom, which is opening a Nordstrom Rack location in Union Square, is looking at another site on Fifth Avenue. . . . more

Commercial property prices broke a 13-month losing streak in November, measuring a 1% increase over the prior month, says Moody’s. However, the report accompanying the monthly Moody’s/REAL Commercial Property Price Index, which is prepared using Real Capaital Analytics data, makes it clear that this doesn’t signal the beginning of an upward trend. Instead, it calls the monthly gain "a small bright spot" for the commercial sector, which has seen a 43% nationwide decline in values from the peak.

"We expect commercial real estate prices to decline further in the months ahead," the report says. "Prices for properties with short-term lease structures, such as multifamily, could show signs of a sustainable recovery later this year, while other property types will likely need longer to turn the corner." . . . more

Wednesday, January 20, 2010

The state Supreme Judicial Court handed the developer of the Westwood Station project a victory on Tuesday by deciding that the town of Canton missed a deadline to appeal a key state approval for the massive project.

But Jay Doherty, CEO of Boston-based developer Cabot, Cabot & Forbes, said the court ruling is secondary to ongoing efforts to obtain state and federal funding for improvements to the Dedham Street corridor that would address concerns raised by Canton officials in their suit.. . . more

A site plan review for a proposed Target at the former Building 19 site is scheduled for Monday, Feb. 1.

Town Planner Steve Antinelli said plans for the site include demolishing the existing 80,000-square-foot former Building 19 building as well as part of the existing Seabra building to make room for the 135,650-square-foot Target plaza. . . . more

Uno Restaurant Holdings Corp., a Boston-based chain that has nearly 30 restaurants in Massachusetts, said today that it has filed for Chapter 11 bankruptcy protection as it looks to restructure its debt. While the company just closed 16 underperforming restaurants, customers at the company's remaining 179 restaurants won't notice any visible changes, said Rick Hendrie, Uno's senior vice president of marketing, during a telephone interview. .. . . more

Supermarket chains, ground down by a year of price wars aimed at keeping hard-pressed customers, are starting 2010 wondering how much longer they can go without further harming their share prices.

Grocery-sector stocks have taken a drubbing the last three months, with Kroger Co. down 14 percent, Supervalu Inc. down 11 percent and Winn-Dixie Stores Inc. down 27 percent. Safeway Inc. is down 7 percent.. . . more

Belden Jewelers at the Liberty Tree Mall in Danvers closed Jan. 9, said David Bouffard, vice president of media relations for Sterling Jewelers Inc. of Akron, Ohio, the parent company of Belden Jewelers.

"Beyond public information such as that, we cannot disclose confidential and proprietary information," Bouffard wrote in an e-mail. He had been asked how many employees worked at the store. Belden Jewelers is a division of Sterling Jewelers Inc., a wholly owned subsidiary of publicly traded Signet Jewelers Limited. . . . more

Nordstrom is angling to open one of its off-price Rack stores on Midtown's Fifth Avenue, The Post has learned.

The Seattle-based department-store chain -- which already has announced it will open a Nordstrom Rack in Union Square this spring -- is in talks to lease 521 Fifth Ave., a retail space at 43rd Street that was vacated last year by now-defunct Circuit City.

"We are looking at that site, along with others, about the potential for a second Rack store in New York," Nordstrom spokeswoman Brooke White told The Post. . . . more

Tuesday, January 19, 2010

Drugstore operator Rite Aid Corp. on Tuesday named executive Bryan Shirtliff as senior vice president for business development, a newly created post.

The company is planning to implement a strategy called segmentation, which groups stores together based on their locations or the amount of business they do. Rite Aid said Shirtliff will be responsible for developing business plans for different segments.. . . more

Each year some large retailers face the fall-out of a weak holiday season. The problem was particularly acute in 2009 because the improvement from 2008 was modest if there was any improvement at all. The 2008 holiday sales period was one of the worst on record. There is some evidence that e-commerce revenues improved, but most of that money went to virtual stores, particularly Amazon.. . . more

If a store offers a dishwasher on sale for most of the year, is it fair to say that the dishwasher is really being sold at a genuine discount?According to state regulations that took effect this month, yes.

Retailers are now allowed to sell merchandise - from furniture and kitchen appliances to shampoo - at so-called sale prices up to 69 percent of the year, meaning they can be offered at the regular price just 31 percent of the time. . . . more

Walgreens plans to roll out fresh foods including salads and sandwiches in all of its 7,000 stores.

The Deerfield, Ill.-based company is banking on time-starved consumers finding fresh fruit cups and ready-to-bake pizzas to be convenient on-the-way-home purchases -- especially if they are already in the store picking up a prescription or buying shampoo.. . . more

Even in recession, there's an upside opportunity. And there might be billions of retail dollars up for grabs for smart marketers able to expand their footprint by taking advantage of cheaper leases.

The downturn that began in December 2007 has been disastrous for companies such as Circuit City, Steve & Barry's, Linens 'N Things and S&A Restaurant Corp. (which owned Bennigan's, Steak & Ale and Tavern restaurants), which have all filed for bankruptcy. Others, such as Sears Holdings, Foot Locker, Quizno's and Ruby Tuesday, have shuttered locations. In total, retail sales declined 6% in 2009, according to the U.S. Department of Commerce.. . . more

Though many people claim real estate site selection is an art, it’s not. It’s truly a science. Understanding where to open a restaurant concept—whether new or more established, large or small—requires research, strategy and calculated placement.

Over the past 25 years, the biggest mistake I’ve seen is operators who take a very simplistic approach to choosing a location. For example, making decisions based on limited data such as population density of the trade area or neighborhood. However, these are the operators who often fail because they did not put in the required due diligence. Here are a few pointers to make your next site selection process more successful: . . . more

There is a vast amount of promise for the retail space as the economy improves. However, not every the stock in this exciting space will rise with vigor. Be particularly wary of trendy stores that are known for selling pricey merchandise. With that in mind, let's take a look at Abercrombie & Fitch.

Abercrombie does carry fashionable merchandise, has survived through tough times and a good number of younger people, despite the economic situation, continue to shop the stores with a smile. However, Abercrombie's major flaw is that some of its merchandise is quite expensive to purchase especially for a younger crowd that isn't always flush with cash. . . . more

Just in time for the Super Bowl, discounter Target Corp. is offering installation for electronics such as flat-panel TVs to its customers.

As part of an expanded partnership with Zip Express Installation, a third-party service, the discounter is offering TV delivery and a basic setup starting at $99. Mounting a TV on the wall costs $249, including delivery. For installation that involves concealing wires inside the wall, the price is $299.. . . more

Enfield-based Bernie's TVs & Appliances filed for bankruptcy Thursday and said it plans to close all its stores.

Founded in 1947, Bernie's advertises itself as New England's largest independent electronics, appliance and bedding retailer, with 15 stores and about 350 employees. It has nine stores in Connecticut, including locations on Lakewood Road in Waterbury and Queen Street in Southington, as well as five in Massachusetts and one in Rhode Island.. . . more

Online and brick and mortar video game retailer GameStop announced this week plans to expand the number of stores around the world and to repurchase shares under an initiative it calls the “2010 Capital Allocation Plan.” Under this plan GameStop would spend $300 million on a share repurchase program approved by its Board of Directors, spend $200 million on 400 new stores around the world and other capital expenditures, and reserve for $100 million for “acquisition activity.”. . . more

Bernie's, New England's largest independent retailer of televisions and appliances, is no longer selling items online, has become less active with a group that gave it national-chain buying power and is not accepting charges on its in-store credit card, leading some retailing analysts to question the company's long-term viability.

Enfield-based Bernie's, with 15 stores spread throughout Connecticut, Rhode Island and Massachusetts, had been in an expansion mode up until two years ago. . . . more

Johnny Rockets, which is known for its 1950s-style diners, is introducing a sports bar, a fast-casual concept and a mobile kitchen variant in an effort to appeal to both upscale and down-market customers.

The new Johnny Rockets Sports Lounge concept debuted in 2008 in a Six Flags amusement park in Queensbury, N.Y. A second unit officially opens Thursday in New York City’s Upper East Side and will serve as the model for future locations, said John Fuller, who was recently named president and chief executive of Johnny Rockets Group.. . . more